TaxTMI 
TaxTMI 
2018 (8) TMI 746
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....on under section 17(2)(vii) w.e.f. 01.04,2010, and since the larger part of the arrears received by him pertained to the years prior to 01.04.2010, the relief under section 89 of the Act should be allowed to him. In his submission he has also mentioned that the A.O. was confused and had passed the impugned order in a hurried manner without properly considering his submissions. The assessee claimed this as exemption u/s 89 of the Act. 3. The AO held that section 89 of the I.T. Act, 1961 is applicable where an assessee is in receipt of a sum in the nature of salary, being paid in arrears, or in advance, or is in receipt, in any one financial year, of salary for more than 12 months or a payment which, under the provisions of clause-(3) of section-17, is profit in lieu of salary, or is in receipt of a sum in the nature of family pension as defined in the explanation to clause (iia) of section 57, being paid in arrears; that on the contrary, the payments made by the employer are value of perquisites, u/s 17(2) as per Form no. 12BA, this amount of Rs. 28,70,929.44/- cannot qualify for relief u/s 89(1) therefore, relief claimed u/s 89(1) amounting to Rs. 5,27,403/- is disallowed and ad....
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....o not come to the help of the appellant. (E) Relevant documents were requisitioned from the appellant during the present proceedings.......................... On a perusal of the above three documents, it becomes evident that:- (a) The employer has treated the arrears of Rs. 23,56,430/- paid by it to the appellant in lieu of the employer's contribution to the newly-implemented 'Defined Contribution Scheme' under the category of 'perquisites' and duly shown it at Column No, 17 of Form No. 12BA. (b) The relief under section 89 has been shown as Rs. 5,27,403/- at column no. 15 in Form no. 16 but no details thereof have been attached as can be seen in the copy of Form No. 16 supplied by the appellant to me on 12.12.2017. This relief, obviously, has been shown by the employer, relying on the verification made by the appellant in Form No. 10E. (F) As a confirmatory proof as regards the nature of the said arrears received by the appellant, I have been able to lay my hands on the Circular no. CO/HR/ Pol/W-19 dated 04.04.2014 issued by the Corporate HR Department of GAIL (India) Ltd. It is available on the web and in reference and in c....
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....) of Income Tax Act as per Form 12BA. Therefore, these arrears cannot be qualifying for the relief u/s 89 of Income tax Act. Therefore, the relief claimed u/s 89 amounting to Rs. 5,27,403/- is disallowed and added to the tax shown in the return of income. 5. That, the Appeal against the Assessment Order passed u/s 143(3) of Income Tax Act was filed before the ld. CIT(A). The Appeal was also disallowed by the CIT(A) observing that the arrears in the present case pertains to a perquisite and not to salary or profit in lieu of salary or a family pension as defined in the explanation clause (iia) of Section 57 of the Act. 6. That, the AO and the ld. CIT(A) has misinterpreted inadvertently the definition of salary as shown in Section 17 of the Income Tax Act, 1961. Section 17 of Income Tax Act held as follows:- "Salary", "Perquisite" and " Profits in lieu of Salary" defined 17- For the purpose of Section 15 and 16 and of this section,- (1) "Salary" includes: (i) Wages (ii) Any annuity or pension (iii) Any gratuity (iv) Any fess, commission (v) ...... (vi) ...... (vii) ...... ....
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....ne lakh rupees." 10. However, as per the provision of Section 89 of the Income Tax Act, the relief under section 89 had been claimed in the return and also considered the salary in arrears (i.e. contribution to superannuation fund) pertaining to the earlier assessment years (i.e.2007-08, 2008-09, 2009-10, 2010-11, 2011-12, 2012-13, 2013-14 & 2014-15 respectively). 11. Further, section 17(2) (vii) of the Income Tax Act, 1961 was inserted w.e.f. 01.04.2010 from the A.Y. 2010-11 and therefore, the contribution to an approved superannuation fund by the employer to assessee exceeding one lakh became taxable w.e.f. 01.04.2010. However, the contribution of above said nature fund was not taxable before the A.Y. 2010-11. Therefore, the relief under section 89 of the Act is largely on account of the reason that the contribution to the superannuation fund belongs to A.Ys. 2007-08, 2008-09 and 2009-10 were exempt from payment of income tax in the respective Assessment Years. 12. That, the relief u/s 89 of Rs. 5,27,403/- was mainly accrued on the amount of contribution made towards superannuation fund for the Assessment Years 2007-08, 2008-09 and 2009-10 amounting to ....
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.... being a government employee in a company, is entitled to relief u/s 89(1), he must furnish particulars for the purposes of TDS, as prescribed. Rule 21AA provides the prescription, in the shape of form 10E. Under Form 10E, the particulars required to be furnished are those of income referred to in Rule 21A. Rule 21A, as noted, talks of, inter alia, income by way of salary. 'Salary', as per section 17(1)(iv), includes perquisites. The contribution in question is, admittedly, a perquisite. So, the circle is complete. Form 10E, ergo, does relate to the contribution under consideration. Then, Rule 21A(1)(e) read with Rule 21A(6) may not help the assessee, but Rule 21A(1)(a) read with Rule 21A(2) does. Rule 21A(1)(e) read with Rule 21A(6) concerns cases where, inter alia, the payment is not in the nature of salary paid in arrears or in advance, whereas Rule 21A(1)(a) read with Rule 21A(2) pertains to cases, inter alia, where salary is received in arrears or in advance. The assessee's case falls under the latter category. So, Rule 21A(1)(e) read with Rule 21A(6) being not helpful to the assessee, is, in no manner, detrimental to the assessee's claim. Further, it is true, that as per the ....